Indef: Second-stage stimulus could have multiplier effect on economy
Executive Director of the Institute for Development of Economics and Finance (Indef) Esther Sri Astuti has assessed that the second economic stimulus package for 2026 could potentially provide a positive multiplier effect for the economy, provided the instruments are implemented effectively.
According to Esther, food assistance, transport incentives, and internship and vocational programmes each serve distinct functions, ranging from maintaining purchasing power and increasing mobility to strengthening workforce skills.
“If it is effective, then the multiplier effect will have a positive impact on the economy,” Esther said when contacted by ANTARA in Jakarta on Tuesday.
The government has allocated a second-semester 2026 economic stimulus package worth Rp26.34 trillion, comprising stimulus and incentives of Rp2.04 trillion, internship and vocational programmes of Rp6.26 trillion, and food assistance of Rp18.04 trillion. The government rolled out the package to maintain public purchasing power as well as the momentum of economic growth.
On the food assistance component, Esther assessed that the distribution of rice to low-income communities serves to support consumption while maintaining the purchasing power of that group.
“If the food assistance incentive in the form of rice distribution for 33.24 million beneficiaries supports the consumption of vulnerable groups, then this is only for low-income communities and is consumptive in nature. Its function is to maintain public purchasing power,” she said.
The government has positioned food assistance as a pillar of the social safety net to maintain the purchasing power stability of lower-income communities as well as food stability.
For the second phase of the rice incentive, the government has set an allocation for 33.24 million beneficiary families, each receiving 10 kilograms per month for the July-September 2026 period. The National Food Agency stated in late July that 997.2 thousand tonnes of rice for the three-month allocation is planned to be distributed at once starting in August.
Regarding transport incentives, Esther assessed that fare discounts and travel incentives can increase mobility while also having an impact on the tourism sector.
“Fare discounts and travel incentives boost mobility as well as the tourism sector. These incentives should apply only to flight tickets to tourism destinations. The cheapness of flight tickets must be significant in order to attract tourists,” she said.
In the second-semester 2026 stimulus package, the government has provided transport incentives during the school holiday period and is preparing incentives again for the Christmas and New Year period.
These incentives include a 30 percent discount on train tickets and Pelni ship base fares, as well as the waiver of ASDP port service fees during the designated periods.
The government is also providing 100 percent government-borne value-added tax on domestic economy-class flight tickets during the school holiday and Christmas and New Year periods.
Meanwhile, in the employment sector, Esther assessed that internship programmes need to be continued to improve workforce skills.
“Internships must continue to be provided so that workforce skills are upgraded,” she said.
The government has positioned internship and vocational programmes as a stimulus pillar focused on employment and strengthening the quality of human resources.
The second phase of the National Internship Programme has received an allocation of Rp4.14 trillion targeting 150 thousand recent university graduates, while Rp2.12 trillion has been allocated for vocational training prioritised for 220 thousand vocational high school graduates and 50 thousand workers affected by layoffs.
Manpower Minister Yassierli previously said that around 30 percent of participants in the 2025 National Internship Programme received job offers from the companies where they interned. The government is targeting an increase in the absorption of programme alumni into the workforce in 2026.
Beyond supporting consumption, Esther is of the view that fiscal stimulus in the long term also needs to strengthen investment and exports so that its benefits to the economy can last longer.
“Fiscal stimulus should not only be directed towards consumption but also towards strengthening investment and increasing exports, so that its positive impact on the economy is more durable compared to if it is only channelled into consumption activities,” she said.
The government’s stimulus package also includes support for the industrial sector, including a 0 percent import duty on certain goods used by the aircraft maintenance, repair, and overhaul industry as well as LPG imports as raw material for the petrochemical industry.
The Coordinating Ministry for Economic Affairs stated that these incentives are expected to reduce business and production costs, giving industry greater room to improve efficiency, production capacity, investment, and competitiveness.
More broadly, the Ministry of Finance also stated that government policy in 2026 is directed towards maintaining purchasing power, encouraging consumption, and strengthening the private sector, including through support for export-oriented industries.
Furthermore, Esther assessed that budget orientation towards activities that provide long-term benefits is important in maintaining fiscal discipline.
“The impact is also greater. In the future, if this fiscal stimulus is discontinued, its impact can still be felt. This is what is called fiscal discipline, prioritising the budget towards the long term and a broader multiplier effect,” she said.
Regarding the fiscal condition, Coordinating Minister for Economic Affairs Airlangga Hartarto previously confirmed that the additional spending for the second-semester 2026 stimulus package does not affect the 2026 state budget deficit.
Airlangga also stated that there have been no changes or adjustments to the 2026 fiscal posture following the launch of the stimulus package.